Wants Vs. Needs: When It’s Time to Invest in Your Office Technology

Posted by Mike Bistis

January 30, 2018 at 10:00 AM

when it’s time to invest in your office technologyAs a technology consultant at Commonwealth Financial Network®, I frequently talk about technology with the firm’s affiliated financial advisors. Given the pace at which new products come to market, the questions I receive typically revolve around whether advisors should invest in top-of-the-line hardware and systems and how often they should upgrade. It can be tempting to chase the latest trends, but do you really need and i7 processor when an i5 will do? With that in mind, let’s look at what you really need to run an efficient practice, and how to determine when it’s time to invest in your office technology.

When You Just Need Something Reliable

About a year ago, I said a tearful goodbye to my 1998 Camaro. I loved that car as much as anyone can love an inanimate object, but it had problems: it guzzled gas; required maintenance far beyond my skillset; lacked just about every modern-day safety feature; and was generally terrible at handling New England winters. I knew it was time for something more economical and reliable.

Coming of age around the 2008 recession, I picked up conservative and risk-averse financial habits (for better or worse). For months, I crawled classified and dealer sites to find the best possible price on a new vehicle—until the thought hit me: What am I actually going to use this car for? The answers were simple: commuting, groceries, a few short road trips, and general scooting around Boston—all activities I could accomplish with any reliable vehicle. I had to ask myself whether there was really an advantage to spending so much when the car I had already did what I needed it to do.

Fortunately, I stumbled upon a 2010 Chevy Cobalt that was in fantastic shape with some extra bells and whistles. Best of all, it was priced just under the Kelley Blue Book value, quenching my thirst for a good deal. After an inspection and a test-drive, I bought it on the spot. I’ll never forget that first drive home; I was simply blown away by how car technology had changed in twelve years. It had an automatic sunroof, comfortable seats, tight handling—even a remote starter! Under the hood, the engine had a protective cover, labels were clear and visible, and there was adequate space to work. This was such a massive upgrade, it seemed like I had purchased a new car—not one that was eight years old.

New computers these days come with bells and whistles, too; they’re capable of video editing, audio mixing, and running 3D CAD software. But think about what you use daily: spreadsheets, text documents, PDFs, and lightweight web-based applications. You certainly don’t need the equivalent of an Audi Q5 to handle those tasks. In fact, maybe you just need a tune-up, instead.

When Upgrades Make Sense

This begs the question, “When—if ever—do massive upgrades make sense?” Your business technology isn’t the same as a used car, but when technology changes in a major way, it may make sense to go for the Audi. For me, 12 years between vehicles was enough time for comfort, handling, and safety to justify the investment. Technology operates similarly, where what I call a generational enhancement enters the market and is then perfected over a number of years. That is, until the next generational enhancement comes along.

Today, we’re seeing this trend play out in Intel’s processors, where each new rendition improves speed and power, but not in an extraordinarily dramatic way. Ten years ago, we saw a similar scenario with Intel’s Core 2 series. Each version grew stronger and more powerful until something called Sandy Bridge entered the equation in 2011, utterly dominating existing Core 2s in every meaningful way. That is an example of a generational enhancement—and I expect the industry will repeat itself in the coming years. When it does, that’s when it’s time to invest in your office technology. Until then, consider a normal technology upgrade schedule with recommended specs every three to five years, and don’t gun for the absolute best of the best.

For another pertinent example of a generational enhancement, look no further than your pocket. Do you remember the introduction of the iPhone? That single device has paved the way for nearly every feature found on your smartphone today, whether it’s an Android or an Apple device. Compared to brick phones of the past, the iPhone was groundbreaking and caused a massive upheaval in the mobile device market. Looking at that same market today, do you see a significant difference between the iPhone 7 and the iPhone 8? How about the Google Pixel and Google Pixel 2? For most of us, our quality of service won’t improve by investing in the latest smartphone; it’s an unnecessary expenditure.

Consider Your Clients’ Needs, Too

There is an old proverb that says, “Never skimp on anything that separates you and the ground,” meaning it’s justified to spend good money on items like bedding, shoes, and tires. I’d modify that quote to say, “Never skimp on where you spend most of your time.” That’s when upgrades make sense. For example, if your clients respond overwhelmingly well to videoconferencing, consider purchasing an audiophile-worthy microphone and a 1080p camera to provide your clients with the best possible experience. For clients who prefer to meet in person, it may be more sensible to invest in a high-end seating area with a welcoming atmosphere and refreshments. There’s no doubt that a positive environment can affect your clients, your employees—and you.

Addressing the needs of your business is more important than keeping up with the Joneses. Since you know your clients better than anyone else does, you can make educated, informed decisions about what appeals to them. For some advisors, it actually does make sense to have the latest and greatest technology in the office, whether it’s for marketing purposes or simply because their client base thinks those items are important. For most advisors, the focus is on that which we hold most dear: service. Remember, above-and-beyond service comes in many forms; a high price tag doesn’t have to be one of them.

Are you looking to invest in your office technology? Are you keeping yourself to a strict budget or going for the bells and whistles? Let me know your thoughts below.

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